Prescott Real Estate News Blog's purpose is to keep current, past, and potential clients apprised of the real estate market conditions for the Prescott, Arizona Area. National and state news and events will be posted but special emphasis will be placed on Prescott Area and the Yavapai County - Prescott, Prescott Valley, Chino Valley, Dewey and Kirkland/Skull Valley.
-Prescott Real Estate News

News for Prescott AZ - AmericanTowns.com

Wednesday, January 18, 2012

This Month in Real Estate - January Edition

January 2012 Market Update

The national housing market remains strong and steady, despite continued discussion of weakening economies in Europe. The increased concern about global financial market volatility in the news doesn't appear to have softened home buyers' enthusiasm.

Gregory Klump, CREA chief economist, elaborates, "The Canadian housing market is proving resilient in the face of ongoing economic and financial uncertainty, to the benefit of Canadian economic growth." Gross domestic product (GDP), a measure of economic growth, was stable from the previous month and up 2.7% from the previous year. Economists predict GDP for 2011 will come in at a healthy 1%-2% growth. The housing market and economy impact each other for better or for worse, and currently it falls in the "for better" category.

A well-balanced housing market provides a level playing field with opportunities for both buyers and sellers. Interest rates remain historically low and present buyers with extremely favorable financing. The time to act is now, because as global recovery regains its footing, rates will likely rise to keep inflation in check, resulting in a higher monthly housing payment for home buyers.

This Month's Video

Interest Rates

Low interest rates and stabilizing home prices are bringing home ownership within reach for an increasing number of Canadians. When widespread global recovery gains a stronger footing, rates are expected to increase to keep inflation near the 2% target. The Bank of Canada has lost urgency for additional rate hikes, given the increasing concerns over debt levels in Europe and weakening economic indicators in the United States. The low rates offer increased affordability for home buyers.

Home Sales

Resale housing activity ticked up slightly by 2.6%, and still falls in line with long-term averages. Although it largely reflects a gain over the weakened activity the previous year, this marks the sixth time since April 2010 that sales were up year-over-year. Moving forward, sales are expected to remain stable.

Home Price

The average home price in November stood at $360,396—up 4.6% from last year. Earlier this year, elevated sales of higher-end homes skewed the national average price higher. The drop in average price, compared to earlier this year, is more a result of sales in the most expensive markets coming back in line with normal levels, rather than a depreciation of overall home values. This should have a minimal, if any, effect on buyers and sellers.

Inventory

The national housing market remained balanced in November. After marked seven consecutive months of a sales-to-new listings ratio between 52%-53%, it moved up to 56% — signaling a possible drift toward a seller's market. Half of local markets were balanced and a third were in sellers markets. The overall picture remains balanced and that indicates a greater likelihood of steadiness and stability in the coming months, which is a good sign for the housing market moving forward.

Buyer/Seller Tip

If one of your New Year's resolutions is to sell your home, here are a few things to keep in mind:

Although the traditional home-buying season starts in the spring, here are some reasons why listing your home now, rather than waiting, could prove to be a smart decision.

On average, the number of home sales in January drops almost by half from the previous year's peak. A house that is priced right and staged well will stand out even more with less competition.

Lenders, home inspectors, movers, and other vendors also see a seasonal dip in transactions. This could mean a quicker, easier, and possibly cheaper time to buy, sell, and move.

Even if you're not ready quite yet, now is a great time to start the conversation with your local real estate agent. He or she can give you pointers on which repairs and preparations to tackle first, and which ones may not be necessary, saving you time and money. Starting now can help you capture the most buyers by busy season.